“The California Public Utilities Commission agreed last Thursday with a judge’s recommendation to fine Uber $7.6 million for failing to meet data reporting requirements in 2014,” the Los Angeles Times reported. “Uber will appeal the decision, but has agreed to pay the fine to avoid a 30-day suspension of its license in its home state.”

With a valuation in excess of $60 billion, the fine alone posed little challenge to Uber’s cruise toward ever-greater market dominance. But lawmakers and regulators around the world have littered its road to success with obstacles, repeatedly calling into question the viability of its business model. California, which has stayed at the forefront of technological change and aggressively regulated automotive companies like Volkswagen who ran afoul of the rules, has been seen as both a bellwether and a must-win jurisdiction for Uber.

Broad opposition

The company’s home state hasn’t always cooperated. This month’s fine arose from a protracted dispute reaching through several branches of state government. “In June, a state labor commissioner decided that an Uber driver was an employee and not a contractor — a ruling that was non-binding, but could set a precedent for drivers to ultimately demand more perks and pay. A month later, an administrative law judge recommended that the San Francisco company be fined and suspended from operating in California for the failure to report driver data,” the Times noted. “Uber filed an appeal last August, and a modified decision was made public Wednesday, recommending an even higher fine of $7,626,000, plus a $1,000 contempt fine.”

In addition to penalizing the company, California wanted to threaten it as well. As the Guardian reported, “State lawyers recommended a ruling that gave Uber 30 days to pay the fine or else lose the ability to operate in California.” With little choice, Uber decided to pony up the funds to the California Public Utilities Commission, which oversees state businesses devoted to transportation.

A spate of suits

The big-ticket fine joined a long list of legal troubles Uber has devoted substantial resources to navigating. “In an ongoing civil suit against Uber, the district attorneys of San Francisco and Los Angeles have claimed that ‘systemic failures’ in the company’s background-check process have led to registered sex offenders, identity thieves, burglars and a convicted murderer becoming drivers for the service,” as the Wall Street Journal observed. “The suit claims Uber misled consumers about the effectiveness of background checks and seeks a permanent injunction of the business.” Rather than using a service called Live Scan, employed by many California taxi companies, Uber uses Checkr, which matches convictions to individuals based on an analysis of addresses associated with their name, the Journal added.

At the same time, Uber drivers were recently notified of their inclusion in a class action lawsuit against the company. “Uber agreed to the terms of a $1.8 million suit alleging it inappropriately charged customers an ‘airport fee toll’ late last year,” according to TechCrunch. “The lawsuit, filed in November 2015, accused Uber of charging customers the ‘airport fee toll’ several months before the airport required it, letting drivers keep the fee instead. The lawsuit, which affects an estimated 355,000 customers, was a surprise to many folks who had no idea they were involved.”

That news helped sour a new victory Uber scored at Los Angeles International Airport, a huge source of potential business. Officials okayed Uber pickups at the airport “exactly one month after Lyft launched at LAX, which was originally announced by LA’s Mayor Eric Garcetti,” as TechCrunch reported separately. “Uber and Lyft had battled for months with the airport and the L.A. City Council to reach an agreement that allowed pickups at the airport.”

Nick Harris / flickr

For ride-booking services such as Uber and Lyft, California’s roller-coaster ride has only just begun, with recent developments underscoring high demand among the public and high levels of discomfort among public officials. As regulators have cracked down in some places — imposing fines and suspensions — they have eased off in others, permitting the popular app-based companies to expand their areas of operation.

An adverse ruling

At the statewide level, Uber in particular has faced a costly, uphill climb. After years spent tangling with the state Public Utilities Commission, the agency has run out of patience with Uber’s degree of compliance. “The California Public Utilities Commission has slapped the ride-booking company with a $7.3 million fine and ordered its suspension in the state,” as Endgaget reported, “after it failed to comply with the agency’s reporting requirements.”

“When the state legalized Uber and similar services back in 2013, one of its conditions is the submission of detailed reports to make sure drivers accept passengers regardless of their conditions or locations. Unfortunately, Uber turned in incomplete data for 2014 and has been refusing to show CPUC the information it requires for the past few months.”

CPUC revealed that Uber did not disclose data including “the number of requests for rides from people with service animals or wheelchairs; how many such rides were completed; and other ride-logging information such as date, time, Zip Code and fare paid,” according to the Los Angeles Times. Although the fine struck some observers as excessive, it would amount to a drop in the bucket for Uber, which boasts a massive operating budget. “For Uber, which has raised $5.9 billion in venture capital investment, a $7.3-million fine would amount to less than 1% of that,” the Times noted.

Surprising few, Uber responded to the adverse ruling with a promise to escalate. “We will appeal the decision,” said the company in a statement.

“Uber has already provided substantial amounts of data to the California Public Utilities Commission, information we have provided elsewhere with no complaints. Going further risks compromising the privacy of individual riders as well as driver-partners. These CPUC requests are also beyond the remit of the Commission and will not improve public safety.”

LAX expansion

In a separate, unanticipated development, however, Los Angeles International Airport agreed in principle to open its busy traffic circles to Uber and Lyft. To date, travelers have had to rely on workarounds such as meeting drivers just outside LAX, or circumventing the restriction in other ways. In the face of protesting taxi drivers, the airport’s Board of Commissioners voted to make it the largest airport in the nation to grant ride-booking companies full access, according to the Associated Press.

As the Washington Post observed, the favorable decision came at a time when Uber and similar services have faced an increasingly hostile regulatory environment beyond the CPUC fine and potential suspension. “Last month,” the Post recounted, “the California Labor Commission ruled that an Uber driver was an employee, and not an independent contractor, of the company.” Uber announced earlier that it would appeal this decision as well.

Although the struggle to settle the status of ride-bookings was far from over, observers notched the LAX vote as a win not only for Uber and Lyft but for travelers. “The move could significantly alter the way thousands of Southern Californians and tourists navigate the nation’s third-busiest airport, long criticized for traffic congestion and lack of a direct connection to the region’s rail system,” the Times suggested. “If the companies can quickly comply with the airport’s rules, Lyft and Uber services — some offering lower fares than taxis — could be available by September, officials said.”

With public opinion in California still on its side, Uber especially stands to benefit from moving rapidly to satisfy airport officials.

By Chris Reed

Unlike officials in New York, Washington and some other cities in the Northeast, elected leaders and law-enforcement officials in California took a generally measured and in some cases muted response to Monday’s terrorist attack at the iconic Boston Marathon.

The most specific expressions of alarm and concern came in San Francisco, which hosts the locally popular Bay to Breakers race on May 19 and the America’s Cup international sailing competition this summer and fall. Mayor Ed Lee and Police Chief Greg Suhr vowed to closely review security plans for the events and make sure they were strong. Suhr even compared his level of wariness over what the future might hold to where it was on Sept. 12, 2001, the day after the worst terrorist attacks in U.S. history.

In Sacramento, organizers of popular running events such as the California International Marathon and the Komen Race for the Cure reviewed security plans. Marathon director John Mansoor told the Sacramento Bee that what happened in Boston had sent a “shock wave through the running world.”  Mansoor spoke of the difficulty of securing an entire 26-mile marathon route, as opposed to just a race’s start and finish lines.

Upgrades at major events, or no changes at all

Elsewhere in the Golden State, the rhetoric was much more muted.

In Oakland, police said they would have an increased presence in coming days at Oakland A’s and Golden State Warriors games.

In Los Angeles, police officials announced plans for higher-profile security at major events, such as Dodgers games. Airport police confirmed that security had been increased at the Los Angeles, Van Nuys and Ontario airports, which are all under the control of the city of Los Angeles. LAX was the site of a domestic terrorism incident on July 4, 2002, that is rarely mentioned in overviews of homegrown terror.

Orange County Sheriff Sandra Hutchens said that events that draw large crowds, starting with but not limited to sporting and entertainment events, would have additional deputies on hand.

In San Diego, officials didn’t disclose any additional security measures. The San Diego police union, however, warned on Twitter of a phone scam called “Donations for the Boston Explosion.”

The Eureka Times-Standard said Humboldt County law enforcement authorities had taken no additional security steps beyond calling for “vigilance.”

Ever wonder if America is a police state? Wonder no more. Reports the Daily Mail:

“Two British tourists were barred from entering America after joking on Twitter that they were going to ‘destroy America’ and ‘dig up Marilyn Monroe’.

“Leigh Van Bryan, 26, was handcuffed and kept under armed guard in a cell with Mexican drug dealers for 12 hours after landing in Los Angeles with pal Emily Bunting.

“The Department of Homeland Security flagged him as a potential threat when he posted an excited tweet to his pals about his forthcoming trip to Hollywood which read: ‘Free this week, for quick gossip/prep before I go and destroy America’.

“After making their way through passport control at Los Angeles International Airport (LAX) last Monday afternoon the pair were detained by armed guards.

“Despite telling officials the term ‘destroy’ was British slang for ‘party’, they were held on suspicion of planning to ‘commit crimes’ and had their passports confiscated.

We’re tyrannized over by a bunch of dumb thugs. They don’t understand that British English is different from American English. They don’t want you to have fun. They don’t want you to party. They want you to obey, pay taxes and shut up.

And note that the government spies on Twitter, as it does on Facebook. Big Brother not only is watching you, he’s reading everything you write.

Welcome to 1984 — in 2012.

Jan. 30, 2012